Costa Rican President In Silicon Valley, Touts For IT Investment Opportunities

by Mike Godfrey, Tax-news.com, New York

27 April 2001

Costa Rica's president, Miguel Angel Rodriguez, has been in California's Silicon Valley this week to promote his country as an ideal, low-tax environment to set up an IT operation. In a press interview Rodriguez said: 'High tech is not having the best time in the world right now. But it's important for us to maintain ties with Silicon Valley companies and stay close to them. . . . I'm sure that in the downturn there are companies that will find this is the best time to move.'

According to Rodriguez, incentives to set up operations in Costa Rica include not only its favourable tax climate but the country also boasts a stable government and educated workforce. Such benefits have already attracted companies such as Intel, Procter & Gamble and pharmaceutical company Abbott Laboratories. Pat Rayburn, general manager of the Costa Rican Intel operation, who accompanied Rodriguez on his trip, said that Intel was 'very happy in Costa Rica and has been very successful there.'

In declaring the vital importance of companies such as Intel and their impact upon the country and its economy, Rodriguez stated: 'Intel's presence has allowed our exports to grow. It has allowed us to be on the high-tech maps of the world, and has attracted the investment of software companies.' By the same token, because Intel's exports have recently slowed down, 'it has meant a large decrease in our exports last year,' explained Rodriguez.

Rodriguez visited Silicon Valley on his way back to Costa Rica from this week's Summit of the Americas in Canada, where he signed an agreement to support the creation of the Free Trade Area of the Americas (FTAA) by 2005.

The FTAA is expected to extend from northern Canada down to South America, in which area many trade tariffs could be significantly reduced. Rodriguez signed the pact in the hope that the free trade zones will help to tackle some of Costa Rica's problems. He said: 'Still 20 per cent of Costa Ricans are living under the poverty level. We need foreign investment to get out of that situation. We want growth to be the engine of our development.'

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